Are We Blindly Moving Forward?

In just the last few days reports of hacking and ad fraud appeared as footnotes in the trade media.

CMOs have much to be concerned about.

ITPRO announced that a YAHOO malvertising attack left 900 million users at risk of ransomware.  Yes, that was 900 MILLION.  On the same day, Trustwave Holdings discovered hackers who were using RTB platforms to spread a Trojan virus through programmatic ads that do not need to be clicked on to activate the virus.  In other words, simply visiting a site can infect a computer.

As most programmatic platforms do not have robust technology to distinguish between hackers and advertisers, Trustwave believes it is fairly easy to pose as a legitimate business and buy up infectious ads.

It is no wonder that the Association of National Advertisers and the International Advertising Association are raising the specter of transparency concerns.  As a result, they are commissioning studies and surveys in an attempt to stem the flow of fraud across all media disciplines.

ComScore recently tracked NHT (Non-Human Traffic) across a number of campaigns and recognized that 14% of the campaigns generated 5-20% of NHT, accounting for 45% of the total NHT impressions. Another company at the forefront of fraud analysis is Forensiq, "relentlessly fighting online ad fraud".

I would venture that most CMOs have no standards in place with sellers, technology platforms feeding programmatic and traditional trades, their agencies and data providers.

 

Recently, a Jeep SUV was hacked through its entertainment system and controlled from a remote (10 mile) distance and forced to drive off the road.  Chrysler and Harmon are now facing class-action suits.  Could Yahoo face similar negligence suits for failing to protect its users from the malvertising hack?  

It’s getting ugly and it’s just the beginning.

Programmatic Transparency and Self-Driving Media

Oh how the ad business has changed.  Not so much the creative element, although I would argue that advertising was far and away more creative in the last two decades of the 20^th century. And now the rush to embrace a digital cascade of data and social media that waterfalls into an ocean of swirling confusion is impacting the CMO's ability to perform. 

When did it all start?

Could it have been with AOL when it first appeared on May 24, 1985?  After all, it was simply a communication tool and an online social gathering place. 

There was no useful search engine until 1990, when Archie (originally Archives) appeared as a database of searchable web file names.

By 1994, Yahoo (short for "Yet Another Hierarchical Officious Oracle") launched to cobble together and categorized the community of searchable websites.

On September 4, 1998, Google (originally called “BackRub”) made its debut.  Today, Google argues that it has the “right to collect your most sensitive data, as long as it flows across an open WiFi network”

MySpace launched on August 1, 2003 as a more sophisticated social networking site.  But a fickle audience and the debut of FaceBook less than a year later, on February 4, 2004, contributed to its tortuous decline.

Then, the CEO of FaceBook declared “the age of privacy is over”.  And today, Google knows what you’re looking for and Facebook knows what you like and they both know where you are. 

The volumes of data that are collected via the digital pipeline we call the Internet, stretches the imagination.  According to SINTEF, a Scandinavian research organization, 90% of all of the data in the world has been gathered over the last two years, now classified as “Big Data”. 

 

What is Big Data and how does it act and integrate with programmatic media platforms?  

Big data is simply trillions or records of billions of people from a variety of sources to include the web search and surfing, sales, customer contact points, social media, mobile data and more.  It is a massive volume of structured and unstructured data that can be manipulated to predict the needs and wants of individuals. 

What is programmatic buying? 

In its simplest form, programmatic technology platforms allow for automated buying and selling of digital advertising via real-time bidding, akin to financial market trading.   

There are pros and cons to this emerging discipline, not the least of which is a seeming lack of transparency that tends to obfuscate the process. 

 

A recent study by Forrester Research for the Association of National Advertisers suggests there is deep concern and confusion by marketers with respect to cost, quality and real impact.   

But much like the unstoppable advancement of the self-driving car, self-driving media decisions will, in its early stages, suffer the cries of skeptics who mistrust the system to provide promised value.

The root of the problem is lack of trust …. not necessarily unwarranted as marketers and procurement officers pressure ad agencies and media buyers to reduce costs and service fees.  In turn, agencies consolidate into holding companies, utilize technology to reduce staff and increase productivity and, in many cases, act as intermediaries to purchase media and data in bulk, acting as resellers. 

As market evolution begins to demand the placement of enforceable standards for programmatic procurement , quarterbacked by contract guarantees, both marketers and agencies will win.

But both parties must come to the table with the knowledge that a fair and understanding view of business process for each will provide a rising tide to the benefit of all.  

WHAT IF??

Many pieces make up the whole.

There is much buzz concerning Microsoft's intentions when it announced that IE10 would default to a Do Not Track option for advertising.  What that would do to its ad business (and that of advertiser's ability to target ads) is a concern for many marketers.

Who benefits from such a move? 

It appears that  Microsoft, if it indeed is exiting the ad business, as might also be reflected in its shrinking business staff, is looking to ultimately move users away from Google Chrome, and its tracking default, to a "friendlier" Do Not Track platform.

But let's look under the covers.

What would Microsoft do with its ad business?  The recent announcement by Yahoo's Marissa Mayer to rethink the use of cash from its Alibaba deal (about $7 Billion) leads me to assume a bigger deal is at hand. 

Reverse engineering the merger between Yahoo and Bing, Yahoo could use the cash to buy out the Microsoft ad business, bolstering display and, more importantly Search.  Given Marissa's oversight of Search while at Google, it's not a far fetched scenario.

What do you think?

AOL or AWOL ?

Can AOL be fixed or is it time for the company execs to fold the tent and go AWOL?

As an outside observer, internal memos and external "off the record" quips seem to position the company as one grasping at straws, exasperated by bad, very bad, ad sales and earnings.

Tim Armstrong, AOL's CEO, wants to turn the company around with a manifesto of "wants" that reads like a child's tantrum.

This link to SAI's Business Insider puts it all into perspective with a peek into the AOL Master Plan.

The most recent broadside follows with a chart that illustrates how bad display sales really are.

Click on the chart to enlarge it

Where AOL goes from here remains to be seen. It is hard to argue, however, that this once high flying media company will survive in its current form.

IPG'S MEDIABRANDS ON THE FENCE?

At the tail end of 2008, IPG's media management unit, Mediabrands, inked a multi-year deal with Donovan Data Systems (DDS). While it is unclear how much of the IPG spending flows through DDS (IPG agencies place upwards of $25 billion in media annually) it is nonetheless the lion's share.

DDS's competitor, Mediabank, quietly shored up its digital offering and in six short months following the DDS/Mediabrands deal Mediabank signed DraftFCB for digital services. A small but key foothold at IPG.

It was a whoops! for DDS as they struggled to keep the business.

After several starts and stops in 2009, Mediabank hired former Yahoo! and Right Media exec Bill Wise as CEO this past June 2010. It proved to be a wise move as Bill's vision and ability to chart and navigate digital waters was on spot for Mediabank.

Significant strides and development of their offerings over the last eight months, folding in Audience On Demand services in DSP fashion, places Mediabank at the nexus of what is coming next.

And .... it may have panned out as rumors have surfaced concerning a move by Mediabrands to DDS's rival Mediabank. In light of DDS's reluctance to move nimbly into the digital landscape it would not, however, come as a surprise and a severe blow to DDS.

If the Mediabank/DDS contract is up at the end of this year, we may just see a new face at Mediabrands.

NOT FOR SQUARES

In just over one short year Foursquare, a location based, mobile driven social networking site caught fire in over one hundred metropolitan areas, quickly generating as many as one million users. Today, it's a worldwide service catching the eye of Yahoo! and a reputed offer of $125 million for the service.

Is Foursquare just another novel use of social networking that will fade away in a couple of years? What benefits does the service provide its users? Why bother?

Foursquare may just be another application searching for a user base but is, despite its somewhat hokey attempt at gaming, providing useful localized information on a variety of venues.

A user for several months now I can see the potential for the service .... as long as the founders recognize the need to limit input to useful information.

It needs to clean up its act a bit.

Awarding "badges" may be cute, but it just becomes an annoying "side dish". As users "check in" to venues they visit, the service then posts the venue for all to see. Not limited to restaurants or retail venues, there are "check-ins" for street corners, user apartments, etc. .... a sort of wild west listing with some offering no redeeming value.

The tie to the mobile ecosystem offering mobile "coupons" is the key to Foursquare's success. Building an opt-in mobile database will secure their future as they tie themselves to venues focused on local advertising and build relationships with online and offline media industry partners.

With a little clean up and smart strategic positioning I would give Foursquare a better chance of long-term survival and success than Facebook.

CYBER ATTACK ON GOOGLE?

At 12:01 AM (CST) today, April 1, in Taiwan, it is believed the Chinese government, angered by Google’s decision to circumvent internet censorship rules, launched a global cyber attack on the company effectively hampering its ability to operate.

Initial denial of service attacks and shut downs in Europe and Asia are expected to spread to the Americas sometime today as Google scrambles to prevent further service cuts and begins to restore operations in affected regions.

Chinese authorities deny involvement in the attack.

Google’s vulnerability has been compromised and its stock price is expected to crash, losing as much as 75% of its current market price.

Google representatives are meeting with President Obama’s advisors as a security breach for the world’s largest search engine is also raising concerns for national security breaches across government and financial sectors.

The US Government is on full alert providing assistance to Google in an effort to identify the origin of the attack, determined to be centered in Asia.

Other search engines including Yahoo! and Microsoft appear unaffected but are nonetheless taking precautions. Baidu, China’s largest search engine and benefactor of Google’s exit from the country, is also unaffected.

Please note that it is already April 1st in Taiwan.

So, rather than appear foolish afterward, I renounce seeming clever now.

…William of Baskerville in “The Name of the Rose”.

Happy April Fools Day!